Alipay and other payment processors in China may be forced to share transactional data with rivals

11 August 2017

In China third-party payment processing providers face regulatory framework forcing them to share their transactional data with their rivals. The People’s Bank of China plans to obligate electronic payment providers, including Ant Financial and Tencent, to join the new centralized clearing house to make them disclose information on their customer transactions to the competitors.

According to the latest figures China is leading the global mobile payments industry with approximately $15 trillion in transactions processed by payment providers not related to banking institutions. As a result electronic payment processors such as Alipay and WeChat Pay become playing a significant role in the national economy triggering the regulatory efforts to bring third-party payment companies under the umbrella of Wanglian, a new clearing house, by June 2018.

According to the assumption made by Zhang Yu, a Director at iResearch consultancy firm, this move may entail transaction data sharing by such providers with their pals in the industry. He concludes that the launch of such a clearing house becomes a one-sided loss for the payments processing institutions.

Apart from bringing the payment industries to be subjected to the new clearing house, the central bank wants to force non-banking institutions in the peer-to-peer, crowdfunding and private equity industries to join its risk-assessment scheme.